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Uninsured and Under-Insured Drivers Can Cost You Big Money

How messy can an auto insurance claim get? Well, lets see. Take the case of the couple from Fort Worth, Texas who were rammed from behind by a motorist who then sped off. Chased down by a third party who was trying to be a good guy and get the license plate number, the hit-and-run driver doubled back to the scene of the crime.

A Real-Life Case with An Uninsured Driver
Jumping out of his vehicle, the driver, who smelled of alcohol, began to rant at the couple sitting in the car he’d just hit. When the police showed up, the angry offender passed a field sobriety test, but he was still arrested for public intoxication, and then cited for both speeding and driving without a license. Kinda hard for this guy to be more in the wrong, wouldn’t you think?

Well, here’s what happened when the couple filed an auto insurance claim. It turns out the at-fault driver had no insurance, and didn’t even own the car he’d been driving. The actual owner of the car told his insurance company that at the time, the vehicle was being used without his permission.

And what did the insurer say to the poor couple who had just been sitting at the stop light minding their own business when their car was hit? Sorry, dude. (Well, okay, the language was fancier than that.) The injured parties received no compensation for vehicular damage, and none for medical expenses.

Even Their Own Auto Insurance Let Them Down

Then, when the couple turned to their own insurance, they discovered the auto insurance policy, which they had believed to be comprehensive, did not include coverage against uninsured or underiinsured motorists, nor did it include personal injury protection. Two lawyers were consulted and both said essentially what the insurer said — sorry.

What Would Have Made the Difference?

Why would uninsured/under-insured coverage have saved the day in this case? The deductible for such policies is generally set at around $250, and the benefits offer protection against accidents caused by hit and run drivers if the incident is immediately reported to the police. Since officers arrived on the scene within minutes of the accident, the claim would have been approved without question.

And the truly sad part? This is cheap auto insurance. Protection against uninsured or under-insured drivers costs about $75 a year for up to $300,000 in damage per accident. What did the driver in this real-life scenario face in terms of actual costs?

  • a $500 deductible,
  • $2,000 in medical bills,
  • $1,600 in ambulance fees.

The math is fairly sickening when you consider what a little extra cheap insurance would have saved him.

Lessons to Be Learned

The primary lesson to be learned here is never to simply assume your coverage is comprehensive, followed closely by the caution not to cut too much off your coverage in the name of cheap auto insurance. Only by seeking multiple rate quotes, talking with an agent, and understanding the language of your policy can you hope to strike the right balance between affordability and complete protection so you don’t wind up in a situation similar to the one this Texas couple faced.

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